Global challenges and international economic adjustment. Institutionalization of economic-policy discipline in Sweden
The global liberalization of capital markets that began in the 1980s significantly narrowed the scope of economic policy in small, open countries with their own currency. Despite a high level of state redistribution, the case of Sweden exemplifies successful adaptation to the new challenges through institutionalization of economic-policy discipline. Taking the constraints of integrated capital markets into account, the regulation based approach to monetary and fiscal policy resembles the earlier Swedish model in serving four basic economic-policy goals: growth, high employment, social equality, and price stability. Apart from this community of goals, the two periods are linked by economic-policy consensus and social trust - a basic requirement for success under either system.
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